Troubled CannTrust hires an adviser to discover a feasible sale, Cresco rebrands its dispensaries, Harvest Well being & Recreation hits some regulatory snags in Pennsylvania and Ohio – and much more of the week’s best marijuana enterprise news.
Amid turbulence, CannTrust seeks ‘strategic alternatives’
To cap off a rough-and-tumble month for Canadian marijuana producer CannTrust Holdings, the company’s board is now searching at its alternatives – even if that indicates promoting some or all of the enterprise.
The challenges initially stemmed from its organization leadership skirting federal guidelines on cannabis production, and it later came to light that unlicensed MJ had even been shipped overseas – all of which led to the firing of CannTrust’s CEO and the resignation of its chair.
On top of that, CannTrust Holdings mentioned in a news release that the organization is beneath investigation by securities regulators and the police.
CannTrust has brought in an outdoors adviser to assistance it choose irrespective of whether to keep the course or alter trajectory.
MJBizDaily takeaway: In the nevertheless-maturing planet of legal marijuana, temptations can seem that may well attract some to take shortcuts to enhance earnings or evade pricey compliance measures. But the query is irrespective of whether it is worth it in the extended haul.
The flip side of CannTrust’s scenario is it may well offer an opening for probably one particular of its competitors to snap up some or all of the company’s assets, if it decides to liquidate.
Either way, the CannTrust board requirements to locate a way to recoup some of the company’s stock losses due to the fact the scandal erupted, which currently have amounted to roughly 400 million Canadian dollars ($302.7 million).
And that is not even counting a most likely penalty from the Canadian government, which has but to announce irrespective of whether it will punish CannTrust for its regulatory violations.
Cresco Labs keeps on the Sunnyside
Chicago-primarily based Cresco Labs will rebrand all its dispensaries beneath the name Sunnyside in a move the organization mentioned is made to emphasize a holistic wellness method.
Here’s what you will need to know:
- Presently, even though it has 56 retail licenses in 11 states, Cresco operates 22 dispensaries in eight states beneath a assortment of names.
- The very first Sunnyside dispensary is scheduled to open in Philadelphia in November, with future websites planned for Florida, Illinois, Ohio, Arizona, Massachusetts and Michigan.
- The dispensaries will combine higher-finish style from the well being-care, retail and hospitality industries and will also offer you one particular-to-one particular consultations, customized buying and express and preorder lanes for pickup.
MJBizDaily takeaway: The rebranding is clearly aimed at attracting a wider variety of shoppers as cannabis increasingly aims to turn into a much more mainstream solution.
It is also fascinating to note the timing: Cresco’s residence state, Illinois, is permitting recreational usage beginning Jan. 1, 2020, and Cresco is anticipated to choose up additional licenses there provided its size benefit.
Harvest offers with regulatory challenges in two states
Pennsylvania regulators revoked the health-related marijuana cultivation license of an operation lately acquired by Arizona-primarily based Harvest Well being and Recreation.
In Ohio, 3 Harvest dispensaries are on hold and a cultivation facility is beneath scrutiny.
Harvest is attempting to regain the grower license in Pennsylvania by means of the argument that it shouldn’t be penalized for alleged mismanagement of prior ownership.
In Ohio, Harvest is creating the case that it won the cultivation license fair and square.
MJBizDaily takeaway: Harvest’s expertise in Ohio and Pennsylvania reflects the scrutiny that cannabis firms, specifically multistate operators, increasingly appear to face in tightly regulated markets.
The situations also reflect the value of exacting compliance to avert prospective action by regulators.
Florida asks for court evaluation of MMJ licensing
The state of Florida is looking for a court evaluation of a choice that could truly open up the health-related marijuana marketplace, which now is largely controlled by six vertically integrated operators.
This is just the most recent twist in a court saga that has dragged on and on.
But the finish is in sight: The subsequent step is either a hearing ahead of a complete appellate court panel or the state Supreme Court.
MJBizDaily takeaway: It nevertheless might be awhile for legal problems to be resolved ahead of Florida problems added enterprise licenses in the sizzling health-related cannabis marketplace.
In the meantime, the firms that do have the profitable permits are continuing to add dispensaries at a rapid clip. As of July 26, 144 dispensaries had been in operation statewide, up much more than 60% from 88 at the starting of the year.